Granite REIT - Q1-2018 Earnings & Price Target Update
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Granite REIT(GRT.UN) is a Canadian‑based REIT predominantly owning industrial, warehouse and logistics properties in North America and Europe. Properties consist of light industrial properties, heavy industrial manufacturing facilities, corporate offices, product development and engineering centers and test facilities comprising 90 properties totalling 34M sq. ft. as of Mar-31-2018 with a fair value of $2.9B. Magna International Inc. is the tenant at 52 properties contributing 70% of rental income and occupying 60% of leasable area. Other than Magna, Granite had 41 other tenants from various industries contributing 30% of revenues. Of these tenants, each individually made up less than 3% of revenues. Granite holds approximately one third of Magna's real estate.
By net operating income properties are located in Canada (24%), Europe(49%, Germany, Austria, Poland, Netherlands, Czech Republic, UK, Spain) the US(27%). By currency, rental income is denominated in Euros(45%), Canadian(28%), US(26%) and 1% other. Modern warehouses comprise 30% of leasable area, special purpose buildings – 43% and multi-purpose at 23%.
The properties leased to Magna are comprised of strategically located industrial plants providing automotive parts and modules to the world's manufacturers of cars and light trucks for their assembly plants. The portfolio did include several office buildings that comprise 3% of the total square footage of income-producing properties, including the head offices of Magna in Canada and Austria. The Canadian office properties were sold in Q4-2017. MID changed their name to Granite Real Estate Inc. on Jun-30-2012 and then re-organized to Granite REIT on Nov-2012.
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